Digital Media M&A Accelerated in First Half of 2015

Mergers and acquisitions in the digital media space are accelerating, according to data from investment banking and strategic advisory firms.

There were a total of 1,243 deals related to digital media, information and technology announced globally during the first half of 2015, according to Coady Diemar Partners, up from 1,000 during the first half of 2014. That represents growth in transactions of around 24%.

Meanwhile, data from LUMA Partners, a strategic advisory firm focused on digital media, tells a similar story for the U.S. market. The company said it tracked a total of 134 digital media M&A transactions over the past six months, up from 99 during the first half of 2014, representing 35% growth.

Coady Diemar estimated a total aggregate deal value of $99 billion globally for the first half of the year, though it said purchase price data was available for less than a third of transactions.

Industry observers have predicted a shakeout in the digital media market for years, particularly in areas such as advertising and marketing technology where dozens of startups—often with seemingly undifferentiated services and limited scale— face the reality that there isn’t enough room for everyone.

This year has already seen some major deals in the online advertising space, most notably Verizon’s $4.4 billion acquisition of AOL.

According to Coady Diemar, the three sectors with the greatest number of announced transactions were agency and marketing, digital content, and information — the same most active sectors during the first half of 2014.

LUMA, meanwhile, breaks its data down into three categories: digital content, ad tech and marketing tech, which racked up 31, 21 and 23 transactions, respectively.

“So far this year deal activity has increased with fewer large deals. This is a sign of health in digital M&A as both supply and demand have broadened,” said Colin R. Knudsen, managing director of digital media and technology at Coady Diemar Partners.

LUMA Partners CEO Terence Kawaja also pointed to a growing pool of “strategic buyers,” which he suggests will continue to drive consolidation in the sector.